Telenor makes peace with Alfa and plans $23bn merger

NORWEGIAN Telenor and Russian Alfa Group have agreed to merge their Russian and Ukrainian holdings into a $23bn (&pound;14.4bn) New-York listed telecoms firm, ending one of Russia&rsquo;s longest corporate wars.<br /><br />Telenor&rsquo;s stock surged 15 per cent on the news the row had ended. The dispute was seen as a major threat to foreign investment in Russia and could have meant Telenor losing its stake in Russia&rsquo;s second biggest mobile operator Vimplecom in payment of a $1.7bn fine.<br /><br />The deal will see Vimpelcom, worth around $18.4bn, merge with Ukraine-based, unlisted Kyivstar, which analysts said was valued at $5.2bn.<br /><br />The half-decade-long battle between Telenor and its powerful partner, the oil-to-telecoms Moscow-based Alfa Group has chilled Russia&rsquo;s investment climate.<br /><br />Telenor had faced the potential selloff of its stake in Vimpelcom to pay a $1.7bn fine from a Siberian court over the joint venture&rsquo;s expansion into Ukraine.<br /><br />The case was brought by Farimex, an obscure shareholder that Telenor had suspected was acting on behalf of Alfa, but which Alfa denied.